Constitutional Law Class Notes 2/10/04


More on preemption


When we left off yesterday, we said that constitutional law can’t tell us when a federal statute preempts state law, because the Constitution only tells us that when there’s a conflict, there is the effect of preemption.  But how do we know if there’s a conflict?  Where do we look, if not in the Constitution, to find out if there’s a conflict, and thus if there is preemption?


We could look at the text of the statute or legislative history.  If the statute expressly states that it is meant to preempt state law, then you’ve got a good case for preemption.  That’s express preemption.  That’s one of Chemerinsky’s categories.  Congress has the power to preempt state laws that it doesn’t like as long as it is acting within its sphere of authority.  So the first thing to do is to look for that congressional indication that they want to preempt, and see if they’ve done so.


But there’s an even bigger point: preemption is ultimately a matter of federal statutory law, not federal constitutional law!  We ought to be learning about preemption in Legislation!  The answer to finding out whether there is preemption in a given case will be found in the text of the statute in question.  But we’re studying it here, so there.


In this area of “Constitutional Law”, we’re trying to figure out what Congress wants, not what the original Constitution wants.  So this is a bit different!


Preemption is not a question of constitutional law!!!  The constitutional part is quick, easy, and automatic.  If we know what Congress wants, and Congress wants to preempt, then we have preemption.  That’s it!  This class is mostly about interpreting the Constitution, but the nitty-gritty of preemption is not at all about figuring out what the Constitution wants.


But then the question is: just how closely do we stick to the text?  Should we look at legislative history?


The Constitution says that state laws that are contrary to federal law are null and void and must give way.  But that’s the only guidance we get in this matter.


Did the Medicaid statute expressly preempt the Maine Rx program?  No, there was no express preemption provision.  Medicaid could have expressly preempted state laws.  But they didn’t.  That creates a natural presumption against preemption.  If Congress doesn’t use a power that it could you, you might suppose that they didn’t use that power for a reason.


How does the Supreme Court as a judicial body understand what Congress is doing or not doing?  How does the Supreme Court interpret signals from Congress?  Maybe there are some overarching separation of powers principles involved.  That’s what the Legislation class is about, though!  So Foley says that we should go ask Brudney!


First, there is express preemption.  There are three kinds of implied preemption: (1) field preemption, (2) conflict preemption (physical impossibility), and (3) interference or obstacle preemption (state law interfering with federal objectives).


It’s possible for the drug companies to comply with Maine Rx in a way such that they are still in compliance with the federal Medicaid program.  Therefore, there was not conflict preemption in that case.


This is an example where states have actually been invited into the regulatory scheme.  Thus, we can’t have field preemption either.


Therefore, the only possibility is that the state law doesn’t conform to the federal law.  The state law is called an “obstacle” to the federal law.  Is the state law such that Congress wouldn’t want it to exist?  Congress didn’t say so explicitly.  But is Maine Rx such an obstacle that Congress wouldn’t want this obstacle or this interference?  The only way to answer this question is to study the intent of Congress.


How should the Court figure out whether Maine Rx is an obstacle to Medicaid?


The drug companies claim that Maine Rx interferes with and is an obstacle to the long-extant federal Medicaid program.  How do we figure out whether the drug companies are right or wrong?  What’s the method?


Chemerinsky proposes one method.  If there is a claim of obstacle preemption, you must know (1) what the federal objective is, and (2) what the purpose of the state law is.


When you have a claim involving obstacle preemption, you have to know the facts.  You must know what’s really going on.  We need a good deal of substantive knowledge about how the state law works.  We also need information about the purposes of the federal law.  Then we can ask whether what’s happening under the state law is in conflict with the federal law.


Is it consistent with the federal Medicaid program for Maine Rx to use the prior authorization provisions in the way that they do?  Can we use the prior authorization provision as leverage against the drug companies?


What are the purposes and objectives of Medicaid?  Is it out of sync with Medicaid to use it in the way Maine Rx does?  These are not constitutional questions.  The answers will come from studying and thinking about Medicaid and thinking about what Medicaid needs and wants and why it exists.


If five members of the Supreme Court reach the judgment that it is inconsistent with having Medicaid the way Congress structured it to have Medicaid “hijacked” for this ancillary use, then we have a judgment that the Congress that wanted Medicaid doesn’t want this hijacking!  Then preemption follows…BAM!


But it’s still possible to comply with the hijacking without violating Medicaid.  That’s why this is not a case of conflict preemption.  It’s not a physical impossibility situation.


Ever since the beginning of the country, the Supreme Court has been absolutely uniform in stating that if Congress is acting within its authority, state laws that conflict with what Congress is doing are preempted.  This can’t happen unless Congress has the power in the first place.


The Maine Rx program is not necessarily an obstacle to the operation of Medicaid.  There isn’t enough evidence in the record for the district court to strike down Maine Rx as an obstacle that is inconsistent with the purposes of Medicaid.


Imagine if the Maine legislature had said that a Medicaid punishment will be imposed in order to extort more or less a tax from drug companies.  The district court thus alleges that the state could have used Medicaid to achieve non-Medicaid objectives.


The Supreme Court, when you add up the plurality, they say that the actual program is less extreme than the hypothetical example.  It could be that Maine Rx’s purpose in helping the people “in the gap” is consistent with the purpose of Medicaid.  For example, if the people in the gap don’t get benefits and get sick, they might become poor and sick enough to go on Medicaid and cost that program more money.


There’s also a federal agency involved: the Department of Health and Human Services.  This department has been given the authority to review state Medicaid plans and procedures.  That department has not ruled out Maine’s program.  If the department didn’t like the Maine Rx program, they probably would have issued a ruling against it.


(1) You gotta know the facts on the ground.  (2) You gotta look at constitutional purposes and objectives.


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